NOVEMBER 23, 2007

Why F1 needs a brave new world

It is just a guess but there is a suspicion that if the FIA went nosing around the rubbish dumps and lay-bys of Motorsport Valley at the moment - and other suitable spots around Europe - its computer experts might find a lot of interesting stuff.

The outbreak of F1 espionage in recent months means that a lot of data inside computers at various different locations may need to disappear and, as getting rid of stuff inside computers is a very complicated task, it is easier to get new computers and lose the old machinery. This will provide teams with the peace of mind that they need in this age of claim and counter-claim.

The good news is that security, accountability and verification structures are inevitably going to improve and F1 spies are going to struggle to be hired in the future.

The root problem is money and the effect it has had on the sport. Success is more important now than ever before. That may be hard to imagine given the survival-of-the-fittest ethos that has existed in F1 since the late 1950s but it is a different kind of pressure. In those days you had to keep up technically to survive; to win you needed to innovate. The problem nowadays is that innovation is very hard because the rules are so restrictive and the value of new ideas has increased. And that means that spies have become more valuable as well.

The FIA continues to regulate and champion cost-cutting but this is like trying to fix holes in a leaky dam. The dam is a problem but the real problem is that the water behind it keeps arriving. The biggest teams spend vast sums of money looking for every tiny advantage and it is not just about the design of the cars. The sport is hurtling towards a day when rapid prototyping turns into rapid manufacturing. There is a permanent off-track race to design new parts, to create them, to test them, and beyond that to come up with faster systems so that new ideas go from concept to racing car with the smallest possible delay. Car design only stands still because there has to be a moment at which a car is built and raced. By the time the F1 chassis hit the track these days, they are already out-of-date.

"Nowadays it makes no commercial sense at all to invest the kind of money you need to be competitive in F1 in the hope that you will earn back your investment," said one team boss recently. "You have to have a reason beyond the racing. That can be selling cars, soft drinks or whatever, but there is no logic in anyone other than a major motor manufacturer or an eccentric billionaire buying a team. It is as simple as that."

What is really valuable in the real world is not the ability to spend money (anyone can do that) but rather the ability to get the best value for money. Some of the F1 teams are remarkable in this respect as they produce the same results as teams spending twice the money that they are spending.

This money may not be available for ever because car companies have other problems that they must address. They need huge sums of money and all the engineering skills they can find to tackle the environmentally-friendly legislation that is on its way in the United States where President George W Bush has set a goal of reducing oil consumption by 20% within 10 years. The importance of F1 is somewhat reduced in the face of that. The danger for F1 is that the sport either needs a lot of manufacturers or none at all. It would be disastrous for one to remain in a completely dominant position - as so often happens in sports car racing - rendering the competition irrelevant as a sporting spectacle.

So what is the answer to all of F1's problems?

The logic suggests that what automobile manufacturers would like to see would be some form of budget-capping. This would enable them to use the sport to advertise their efficiency, which would reflect on the perception of their cars. Technical rules would still need to be tight but they must leave open areas where new development can be done.

Budget-capping was an idea suggested back in 2004 by Richard Parry-Jones, the head of Ford's competition activities at the time. F1 laughed quietly. Ford pulled out. The doubts at the time were about the policing of such ideas but with the increasing corporate presence and the slow disappearance of the buccaneering spirits of a previous age, there is more chance now to achieve that. Perhaps the FIA should create a structure to require the teams to make full financial disclosure about how budgets were spent and if there were any anomalies there could be investigations by accountants and lawyers versed in such matters, backed up by suitable administrative and civil punishments as necessary. This would make any offence criminal as it would, in effect, be defrauding the other teams. This would function along similar lines as stock exchange commissions around the world. Commissioners would have to have suitable qualifications and be non-partisan and have staggered five-year terms thus creating enough stability for the job to be interesting but enough changeover to ensure that no bad habits were allowed to develop.

The United States's Securities and Exchange Commission (SEC) was established as a result of the Wall Street Crash of 1929. When the markets fell public confidence in the industry fell with them. That faith had to be restored and the SEC was the result. Perhaps a similar response would be the smartest solution to the problems of F1 today. The espionage scandals of 2007 are shaking confidence in the sport and the FIA would be wise to look at a much broader picture than the "fire-fighting" work of today.